IP Democracy: Apple v. Content Suppliers = Gun v. Bullets?

The ongoing battle between Apple and the content community is an endless source of fascination if you’re a media analyst (and based on the abundant headlines, even if you’re not.) As I posited last week, Apple has got to gain control over content suppliers if it’s going to continue banking on the stream of movies and TV shows to fuel sales of its phenomenal iPod, iPhone and Apple TV product lines.

The latest development in the fight between Apple and Hollywood is Apple’s plan to cut TV show download prices in half, a plan that the studios, to be it mildly, have not embraced. So, the tension mounts — either Apple has to concede more power to content suppliers or start investing in content that it controls.

The New York Times’ David Carr puts it nicely in this piece about Apple’s recent round of unaccustomed jolts. He likens Apple to a gun and TV networks, or content creators generally, to the bullets.

With a ubiquitous installed base — iTunes has been downloaded 600 million times and there are more than 100 million iPods out there — Apple has the biggest media application on earth. Networks and music companies have some bullets, but Mr. Jobs owns the gun.

I think this means that Apple wields the power in this struggle, because, after all, it’s easy to make bullets but hard to make a gun. But later Carr does something of an about-face, using yet another analogy (this one real estate-based), saying that Apple might lose gadget buyers if it doesn’t own the content.

Apple has built a hardware-based kingdom, rendered beautiful to the touch. But my love of the iPod is still driven by all the things I can put on it. If the gated community loses a lot of cultural real estate, will I need to keep my address there?

See, this is an interesting case study. It’s hard to tell who is the gun or who is the bullet or who is the gated community in this stand-off. I’d say that Apple is the gated community only if it buys up a lot of cultural real estate.

Posted by Cynthia Brumfield on September 10, 2007 9:16 AM to IP Democracy